When two blood-and-thunder Welsh derbies take place today in front of big festive crowds in Cardiff and Swansea, it will present a vibrant image to the rugby world. In reality, though, the game in the Principality is on a knife-edge.

There will barely be an empty seat at the Arms Park and the Liberty Stadium as the Blues and Dragons square up first, followed by the Ospreys and Scarlets.

They come on the back of a rare outbreak of positive news, with the Ospreys’ glorious Heineken Cup win over Toulouse preceding an announcement from the Blues that Alex Cuthbert had agreed a new three-year contract.

Trend setter: Alex Cuthbert went against the grain when he committed to Cardiff Blues rather than follow the money in France, where there is no salary cap

The Grand Slam-winning wing’s
decision to go against the grain by staying at home may be just the
boost that the regions were crying out for.

With Jamie Roberts and Dan Lydiate
having already agreed to join the exodus to France, Cuthbert’s decision
to turn his back on the riches on offer in the Top 14 was seized upon
as cause for optimism in bleak times.

And Blues chairman Peter Thomas was
upbeat about the chances of three more marquee players signing new
contracts next year — Wales captain Sam Warburton, fullback Leigh
Halfpenny and lock Bradley Davies.

But the bigger picture provides cause
for alarm. While the Scarlets lie second in the RaboDirect Pro12
league, there is every chance that the Heineken Cup quarter-finals will
again go ahead without a Welsh team.

WRU chief executive Roger Lewis
strongly hinted that the four regions may not all survive in their
current form, with at least one in danger of being re-cast as a
development team, with central funding heavily reduced as a result.

Hopeful: Cardiff want to get the likes of Sam Warburton to follow Cuthbert

One prominent Welsh rugby figure told
Sportsmail that drastic action was needed and that the future formula
should include two ‘primary’ regions and one development region, with
one removed altogether. There is a growing realisation that something
has to give.

Bigger picture: Lyn Jones is concerned by the lack of depth at most levels in the region

London Welsh head coach, Lyn Jones,
said: ‘Three regions is enough. At this stage, they haven’t said which
region will be downgraded or axed, so we’ll just have to wait and see
what happens.’

In a time of economic struggle and a
£3.5million salary cap, Jones believes that finances are a major factor
in the difficulties experienced by the regions, exacerbated by the
growing input of the WRU.

‘The game in Wales needs new
investors to give it a boost, but people won’t get involved if they feel
that their hands are tied. Increased funding from the governing body
has frightened people away.’

However, Jones has no worries about the production of players.

‘Compared to England, far more
players are being produced per capita in Wales. They have to keep
producing young players in order to survive and they have to keep
looking after their treasures.’

Wasps’ former Scarlets, Wales and
Lions fly-half Stephen Jones feels that Cuthbert’s decision to stay with
the Blues may serve as a watershed moment for the regions as a whole,
when it comes to the retention of their stars.

Ready for the fight: Ospreys went into Christmas in good spirits after their hugely impressive win over Toulouse at Liberty Stadium on December 15

‘He is the first one to break the
trend and that suggests that the Blues sold a vision to him,’ he said.
‘Let’s hope that now one of the big names has decided to stay in Wales,
more will follow his lead.’

With the prospect of one region being
demoted to development status, the Dragons are surely most vulnerable,
lying 11th of 12 in the Pro12 league and competing in the Amlin
Challenge Cup this season.

Stephen Jones added: ‘It’s tough for
the Dragons, losing someone like Luke Charteris, who was a leader for
them, was a real blow and Dan (Lydiate) now.’

But he believes the other regions
have the ability to keep filling voids left by high-profile departures,
adding: ‘The key is the production line.

'If the regions can keep enough strong
role models in their squads to give guidance and direction to the
youngsters, then you have a healthy system.’